The Director of Strategy and Policy at urban fibre optic developer CityFibre, Mark Collins, has today revealed more to ISPreview.co.uk about their Joint Venture plans with Sky Broadband and TalkTalk to roll-out an “ultra-fast” 1000Mbps capable Fibre-to-the-Premises (FTTP/H) broadband network for UK homes in three cities, starting with York.

The past year has been very busy for CityFibre, which has announced plans to deploy its fibre optic infrastructure into several new cities across the United Kingdom and recently raised millions in additional investment funding by floating onto the London Stock Exchange (here).

At present CityFibre has already built its own primary fibre optic networks in Bournemouth and York (here), while they recently announced similar deployments in Peterborough (here) and Coventry (here). The operator also manages a variety of other networks and are busy considering future roll-out plans for a number of additional large towns and cities, such as Bath (here).

Until recently most of CityFibre’s fibre optic deployments, except its service in Bournemouth which was originally constructed by the i3 Group UK, have predominantly focused upon serving the public sector and businesses. But all that changed in April 2014 when CityFibre announced a bold new Joint Venture with Sky Broadband and TalkTalk (here), which would adapt the operators network in York to deliver a 1Gbps fibre optic broadband service to thousands of homes across the city, before potentially expanding into two additional cities.

A new company will be created to support the new service, which will make use of and extend CityFibre’s existing 103km long FTTP network in the city, and the first customers are then expected to go live in 2015. The long-term plan is to make the new service available city-wide, although initially the roll-out will only focus upon 20,000 homes (representing about a quarter of the city) and is being supported by an investment of £5m each from the two ISPs.

But the new network faces many challenges, not least with the difficulty of attracting customers in a market where rival superfast broadband services from operators like BT (FTTC) and Virgin Media (Cable DOCSIS / FTTN) are already available. Questions have also been raised over the economic viability of the plan, with TalkTalk controversially suggesting that it might technically be cheaper to roll-out FTTP than hybrid-fibre FTTC. Suffice to say that ISPreview.co.uk were keen to learn more about the development and managed to put our questions to CityFibre’s Mark Collins.

The Interview

Q1. TalkTalk recently said that the economics of the joint approach to FTTP in York could prove highly attractive, with a combination of scale and low cost build technology delivering a “significantly lower cost per home passed” than for the current FTTC infrastructure.

Meanwhile the reasons BT are deploying FTTC is because they can reach tens of millions of homes and businesses for comparatively low cost, largely because they don’t need to re-build or replace the costly “last mile” connection from cabinets and into homes.

Naturally there are ways to cut the cost of deploying FTTP, such as via micro-trenching (we note that the FTTP roll-out will use this) and using telegraph poles, but it would surely take a lot more than just those to make rolling out FTTP cheaper than FTTC; especially as you’d still need to keep the old copper network running at the same time in order to support legacy users. Can you clarify where the other cost savings areas are?

ANSWER:

CityFibre is building brand new, fit for purpose network that needs to constantly deliver cutting edge broadband technologies for at least the next century. In order to achieve this, our infrastructure must be built from scratch – simply reutilising existing, legacy networks will simply not measure up.

By starting afresh, we have the advantage of being able to carefully plan this network’s on going growth and the ability to consistently deploy new methodology and techniques as they are created. Practices such as micro-trenching means our infrastructure can be deployed effectively and efficiently but also seamlessly upgraded whenever required.

What will ultimately be achieved is a tremendous example of shared infrastructure, where the benefits of multiple usage – whether that is for home or business broadband – are enormous. Not only does this shared ecosystem deliver unparalleled, real end-to-end fibre solutions but it reduces costs thanks to the number of involved stakeholders. Our new built pure fibre networks have very efficient operating costs, which also benefits to cost of using our networks.

Q2. The involvement of Sky Broadband and TalkTalk is extremely good news but isn’t there a risk that this might create confusion with existing packages and availability if offered through the ISPs current websites, or will you only offer related FTTP broadband packages through the new company?

ANSWER:

CityFibre will be responsible for managing the planning and construction of the fibre network and ensuring it runs smoothly at all times. All broadband services will be provided by TalkTalk and Sky directly.

TalkTalk Consumer and TalkTalk Business will be selling a range of competing ultrafast services to their residential and business customers. TalkTalk Group will also build and manage the billing provisioning and assurance systems that will enable customers to connect to the network. Sky meanwhile will be predominantly focussed on selling a range of competing ultrafast services to their residential customers.

Both companies are experts in targeted marketing and they will leverage their experience gained in localised promotion of unbundled DSL services. This will ensure residents of York receive the full benefits this new network has to offer.

Q3. Some analysts have questioned why the focus is on York and not Bournemouth, where 20,000 premises are already passed by CityFibre’s FTTP network?

ANSWER:

All joint venture partners agree that, in order to most accurately assess the process of FTTH deployment and marketing, from start to finish, it would be best to start with a clean slate, rather than launch into a partially complete network in a city like Bournemouth.

York is an ambitious digital city – it wants to become the Digital Infrastructure Capital of the North, and we are looking forward to working with York Council and other local interest groups in helping them make this a reality by giving them the UK’s fastest broadband speeds.

Given our existing investment in Bournemouth we would not rule out the possibility of the city being part of any of the joint venture’s expansion plans in the future.

By Mark Jackson
Mark is a professional technology writer, IT consultant and computer engineer from Dorset (England), he also founded ISPreview in 1999 and enjoys analysing the latest telecoms and broadband developments. Find me on Twitter, Google+, Facebook and Linkedin.

This was the correct approach for BDUK. A project combining multiple players investing a stake in a brand new network, creating competition which then naturally drives improvements without the need for endlessly ongoing taxpayer bungs to BT.

Believe I’ve said this, oh, perhaps a hundred times over the last few years 😉

Sadly, they didn’t take it, and BDUK – in this context – is the barrier to building competitive and even faintly future-proof networks like this one.

While the investment here probably isn’t great shakes to the likes of Talk Talk and Sky who are going to very much enjoy migrating customers away from the GPO/BT network and putting two fingers up at BT – the BDUK program is such a serious impediment to projects like this – and I think they’re a little mad to challenge the State telephony network like this – I very much welcome this and wish them every success.

Very well done for putting together something similar to that which I’d suggested for a long time, it’s really good to see it happen.

The big problem is BT’s stranglehold on the local loop. It is a very big risk to take on the incumbent operator who outside of the cabled areas controls pretty much a 100% of the market. Removing the local loop from BT control is the only way we will see real competition anytime soon

Yeah, just a long time ago the cable companies promised to cable up the UK.
They cherry picked the best bits – promptly went bust due the costs and the rest of the UK was abandoned.

Anyway,
Do we have have these throwaway comments to EVERY SINGLE article on here about how X should get on with it and put in 100% FTTP while never mentioning the cost.
Might as well tell someone with a few slipped tiles to totally re-roof the house and then listen to their reply – unprintable

Come to think about about it when are we going to have gas supply to all of the UK villages?

This is an area where BT overcooked it and talked themselves out of the ‘market’ by claiming it necessarily takes seven hours to attach one house to a network.

I suppose if you’re hell-bent on shoving cable down blocked 40 year old ducting then you will have this problem. The reply hints at this.

Other people can do it, but for whatever reason, BT simply cannot. Bit of a shame as BT might have been of some use in the medium to longer term after the bodge job on the phone network to make it last a bit longer is completed.

Now what the government needs to do is to turn the “fibre tax” into a reverse tax e.g. the provider gets a reward not a charge for laying fibre, get the LAs on board to help organise and support this where necessary, and generally “get out of the way” – become part of the solution as opposed to being part of the problem.

They appear to have earmarked specific areas which they think they can do. I’ve never laid ducting myself but I can’t honestly see how it can take a particularly long time to run round streets and estates cutting ducting in. Homes only need be connected when they sign up, what’s that, half an hour or so to run the fibre (similar to cable), with some exceptions like very long drives.

Will they manage it, and will then they seamlessly flow onwards to complete coverage of most or all of the city…? How will they price the installation charge given they’ve picked – again – areas with potential competition where this might be a greater issue? We shall see.

You are FibreFred, in cases where 2 FTTC cabinets are needed along with all the civils, etc, and ducting is already in place to each property would it be cheaper to build the 2 cabinets or to deploy FTTP?

Cost of provision is one thing, but if the ROI is very low due to poor take-up and even more than that, you don’t just lose the broadband but also the line rental customer, you have an incentive (now, and looking ahead) which is currently missing.

‘TalkTalk Group will also build and manage the billing provisioning and assurance systems that will enable customers to connect to the network. Sky meanwhile will be predominantly focussed on selling a range of competing ultrafast services to their residential customers.’

Fascinating. This seems to imply that CityFibre own and operate the infrastructure, TalkTalk Wholesale handle, well, the wholesale aspect and Sky will, alongside TalkTalk, retail products on the network.

With TTWholesale involved anyone purchasing from them will also be able to deliver services, so AAISP, Uno, etc.

well this be a good one I doubt all talk and sky will be any good with 1000mbps when there fibre is a shambles but I will see more complaints arriving when this happends fibre isn’t much better than adsl and suppose to be five times faster where at ?

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